Tips for buying property in Bangkok as an expat

Posted on 29. Aug, 2010 by admin in Bangkok

Due to Thailand’s strict restrictions and laws regarding foreigners purchasing property, the most favoured way for foreigners is investing in apartments and condos. Several real estate developments within Bangkok are managed and owned by foreigners who are specialised in offering services and advice to expatriates.

Numerous Thai development businesses as well are targeting this market’s expanding lucrative sector, and all new constructions have English speaking receptionists, sales teams and management members.

For those wanting to buy apartment units in the Thai capital, there is a huge market for more expensive condos. The condominiums that recently have been completed launched a competition campaign for those who are leasing or selling their units and properties. Due to this competition there are even more opportunities for potential buyers. More than 19,000 condos have been built over the past five years.
 
The largest part of the more recent apartment complexes appear to be built around the Silom, Sathorn and Sukhumivit areas. These units’ sizes range from 40sqm to 75sqm and feature one, two or three sleeping rooms. For the incredibly luxurious condos in these districts, three to four sleeping rooms ranging from 85sqm to 185sqm are quite usual. Aiming for the condo spectrum’s lower end is more common for foreign buyers. A market for purchasing bargains in ageing or modest structures is available as well.
  
The newest trend in buying condos in Bangkok is the off-plan scheme, in which it isn’t longer necessary for buyers to inspect the actual condo they’ll be purchasing. The buyers simply trust in the firm’s reputation and decisions are being made based on the show rooms of the real estate developers.

This way of buying property in Bangkok isn’t uncommon at all as almost 10,000 condos were bought in 2006 strictly via this scheme. Purchasing pre-build will qualify you for attractive discounts, up to 25 per cent. If the complex sells out and is smoothly completed the value might rise even farther. Typically instalments and a deposit are due throughout the property program (up-to 18 months), with ownership transfers upon completion of construction and payment.
 
Numerous investors earn very well by investing in these properties and selling them before the developer’s transfer is made, not having to pay tax. The more progressive property developers occasionally offer to lease the apartments on your behalf with the guaranty of returns, which sometimes are more than 10 per cent, although this amount is uncommon. However, it is rather risky buying ‘off spec’ and there are projects that fail, leaving buyers financially broke.
 
It is of great importance that you thoroughly investigate the reputation of the developers, the economic outlook and the building’s sales rate, as these all may conspire leaving several investors in a messy legal situation that sometimes becomes too complicated to resolve problems honestly. There are also cases of the developer having defied the building laws, assuming that bribery will resolve any difficulties, but the Bangkok authorities have started to crack down. Due to illegal activities several properties have had their building approval suspended.

About 80,000 baht per square metre was the average selling prices for condos in Bangkok early 2008. Rates continue to rise around 10 per cent annually.

Bangkok is one of Asia’s main expat centres and also represents some of the region’s most expensive real estate. Likewise this metropolis features a professional, well developed and long-established industry of real estate agents to meet a variety of the clientele and markets’ demands.
 
There’s a dedicated sector catering to non-Thai residents, with international real estate businesses managed and owned by Westerners to meet the big spenders’ expectations. Typically these property agencies maintain comprehensive portfolios, supported with professionally maintained and up-to-date online resources, with an extensive range of condominiums and houses that may be suitable to both multi-national executives and modestly paid teachers looking to purchase homes in Bangkok.

However, it is strongly recommended doing some research on your lawyer and real estate agency’s reputation, since Thai law doesn’t always protect property buyers against illegal practices.

The house and condominium markets are viable opportunities for foreigners interested in property investing in Bangkok. At either the price spectrum’s high or low end, there always will be apartments and houses on offer that fit within any budget’s frameworks. It is quite common for foreigners buying such property developments and then hiring them out to other persons.

Suburban Bangkok real estate developments are typified by the widely available housing estate that is popular with the city’s emerging middle class, judging their social status by the prestigious, family-orientated and secure suburban bliss reflected on such projects’ brochures.

Numerous long stay expatriates have also moved far out to these tranquil residential areas. Some investment and buy to rent them to foreigners and Thais alike, but a Thai name will always be necessary for legal ownership documents. The downside of property, however, is the commute in Bangkok’s famously congested traffic and this applies to all property investment in Bangkok.

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